Say Hello to Vanguard’s Newest Member :)

I officially pulled the trigger(s) and moved all my investment accounts to Vanguard.com! I’m pretty excited. I know I should have done it all years ago, as no doubt some of you will remind me of, but just like everything else in life we get to things when it finally becomes a priority :) And I was tired of being lazy and not knowing what I was doing with my investments. (Though, interestingly enough this move will allow me to be even more lazier, once I get things fully set up and moving)

I’ll have to do another post later on what, exactly, I’ll be investing in with these accounts, but switching to Vanguard in itself should give you a good hint as to the general direction ;) Today, however, I pat myself on the back for taking the first step by moving institutions. Something I didn’t take lightly as I finally got all my financial accounts under one roof with USAA – still my all-time favorite company (just not when it comes to investments, since other places specialize in it).

And I wanted to do it at a place that specializes in just that – no offense to USAA (If we’re talking car insurance or online banking, they’re pretty much the pioneers).

Interestingly enough Vanguard is also owned by their investors themselves, which I later found out (and loved hearing). So in a way I now own part of a billion dollar company to boot :) The whole story of how Vanguard came about is actually quite fascinating, and would highly recommend learning about it if you have the time and interest. Start with their Wikipedia page. The founder (Jack Bogle) is credited with creating the world’s very first index fund, and there’s even an entire forum dedicated to his vision at Bogleheads.org – pretty cool stuff.

And I gotta tell you, I haven’t felt this good in a while. It’s nice to take action and move closer to financial responsibility :) After tweeting about it earlier too it seems I’m not the only one crushing on them either!

In fact, every person I told after tweeting this only had good things to say about them too. I was pretty shocked to be honest, I couldn’t find any haters out there?? I even asked!

So if you haters do exist, please do speak up. You have to wonder about a place that no one ever complains about, don’t you? At least to have a formidable debate! ;)

Something else I was pleased to find was the EASE and QUICKNESS of moving everything over too. I literally had to create three brand new accounts (SEP IRA, Roth IRA, and Traditional IRA – which will later merge with my SEP which I never know was possible? (Yeah condensing!)), and then on top of that TRANSFER OVER all my 5 accounts from USAA too boot. Since I had so many set up for my crazy IRA Testing many moons ago (which I’m also happy to retire).

Wanna guess how long all that took me? About 80 minutes flat. All on the phone, and without paperwork or anything. I’m still very much in shock :) I even broke the calls down in chunks thinking it was going to be a nightmare, haha… I mean, we were dealing with a half dozen accounts all over the place? How could that be so easy? Remember back in the day when it was all face-to-face or mailing packets of paperwork all over town? Ugh…

(Sorry, couldn’t resist ;))

I was also pleased to know that their customer service was top notch too. Very similar to USAA which was one of my main concerns. I like things nice and easy, and even more so nice PEOPLE on the other end of the line. I don’t do bad service anymore, I’m too old to deal with that crap ;)

I’ll report back once I have a better grasp on everything and invested in my new funds, but I just had to pop in and let y’all know what I’ve been up to lately. I highly recommend* you guys checking out Vanguard too if you haven’t done so already. I’m sure they’re not for everyone (again, good time to speak up haters!), but seeing how they currently hold over two TRILLION dollars worth of people’s money, something tells me I’m in safe hands.

Now where all my Bogleheads at? And do I really have to call y’all myself that? ;)

——-* I’m in no way getting compensated by Vanguard to share my opinions here. Believe me, I even asked if they had an affiliate plan since I was going to talk about them anyways, but since it’s all owned by members such as myself (with the goals of keeping costs low of course) they don’t even have a plan set up. Which just goes to show how even MORE awesome they are! People pimp them out for free anyways! Especially theearly retirementcrew… you can’t read a full article without seeing their names mentioned ;) Which was what eventually led me to make the move.

Please keep us updated. I am a fan of Tiaa-Cref and it’s funds BUT lately their fees are starting to creep up. On the other hand two of these funds last year returned 38 and 36 percent respectively…so I’m thinking “penny wise…dollar foolish” comes in to play…Your thoughts?

jestjack – they were up that much because the whole market was that much. Nobody can predict where the market is going in any given year and nobody (except maybe Warren Buffett) can consistently beat the market every year. So with Vanguard index funds, you track the market – get those returns with the least amount of fees possible.

The only “hate” I can throw on vanguard is that there is a fairly “high” ($3000) barrier for entry for most of their mutual funds. For someone starting out that could be something that could really dishearten them. Other than that, I have been pretty happy with Vanguard. They erroneously charged me a fee one time and one quick phone call later then reversed it and I haven’t had a problem since!

Ah yes – good point about the $3k barrier. Totally missed that since it’s been a while we had less than that to invest. Guess it has to be higher though in order for the fees to remain low and provide generally great service?

If you can’t meet their “barrier”, use their low cost index ETF’s, then switch over once you’ve got the 3 or 10K. I’ve been talking about Vanguard and Bheads for a LONG time now to J$. Wish he would have listened earlier ;)

No hate here! Vanguard’s fees are so low, it actually makes me chuckle thinking about it sometimes. I had a friend (granted who made a really poor investment, paying some guy 15% annually) what my annual fees were on my investments at Vanguard. He said, “what is it, like 1-2%” expecting to be jealous of THAT number. Try .05% – 1/300th of the fee he was paying!!!

Other than that, I don’t have anything else to say about Vanguard, which is a good thing. It just tracks and goes along and I don’t have to worry about my investments until I need them, many, many years from now.

Love it! I transferred over to Vanguard last summer from etrade. They have really low fees and its easy to conduct transactions. Even though they have relatively high ($3000) minimums for most funds, they have many ETFs that mimic the mutual funds that can be bought one at a time with no transaction fee. I use these to build up to the $3K amount, then buy into the mutual fund.

Awesome! I use TD Ameritrade and invest in the commission-free vanguard ETFs. I also have an account at Fidelity, although I don’t own any Fidelity funds there. I’ve been meaning to look into Vanguard.

I love Vanguard!
I don’t have all my funds with them though, because I get my 401(k) with Fidelity so it made sense for me to open an account with them as well (aside from my 401k). But you can’t really beat Vanguard’s low fees.

I’ve heard great things about Fidelity too (my parents use them), just haven’t dove in really. It is nice having stuff centrally-located though, so I don’t blame you for sticking with them. It’s exactly why I stuck w/ USAA for so long!

You just now are getting on board?? Ah well, at least now I can collect my Vanguard Affiliate Fee…
Oh. Wait…

Anyway, thanks for the links and I’m honored to be in “the early retirement crew” :)

As for hate, here’s all I can come up with:

Many years ago I had one of their financial advisors provide an overview of my portfolio. To my horror, his recommendations included some of their actively managed funds. This from the creators of the best tool ever for individual investors: the Index Fund??!!

In fact, I might have to ping you and ask about my fund choices before I pull the trigger – just to get the seal of approval from a smart man like yourself. And since they’re coming from recommendations on your site and others, I have a feeling it’ll be an easy thing to agree on, haha…

Thanks for putting all your thoughts out there for all us to see – you have no idea how much it helps people!

My husband and I opened a Vanguard account this year. The only negative thing I can say is that they won’t let us name beneficiaries. It is a joint account, and when I questioned how to name beneficiaries, I received a form letter stating that it is not an option, and it is unlikely that we will die at the same time. True, it is unlikely, but not impossible, right?

Legally, when you have a joint account, the other owner is automatically the beneficiary. If something happened, he/she would get complete individual ownership of the account and at that time could then name a beneficiary. That is the whole point of joint ownership with right to survivorship.

Thanks, Kathy. I think the form letter said something like that. It would give me peace of mind to be able to name a beneficiary on the account. All of our accounts have a beneficiary and often secondary beneficiaries. We can have our joint checking account transfer on death to someone and our jointly-owned cars are titled to transfer on death. I know that spouses passing at the same moment is rare, but I like to be prepared for all possibilities! :)

Nicely done. LOVE Vanguard! Bogle is the bomb. You will get to your financial goals faster than ever now!

If you haven’t taken a look at his book “The Little Book of Common Sense Investing”, I highly recommend it. It will convert anyone to low cost index funds. Yes, even people who work in actively managed funds.

Dude, I love Vanguard. I just finished rolling over old pensions into Vanguard accounts and I’m thrilled. I just wish my husband’s 403(b) was through Vanguard. It always pales in comparison to what we’re earning with our Vanguard funds!

We’ve been with Vanguard for years. Never had a problem. We also recently started to use TD Ameritrade just so all our eggs aren’t in one basket. Both places have excellent customer service and research tools. Knowledgeable English speaking customer service technicians. Outstanding.

I’m in the same boat! I don’t want to leave USAA, because of the “under one roof” thing and because I love them, but Vanguard it pretty sweet.

I actually published an article yesterday on index funds and I included specific funds to use for retirement. I used USAA funds, but they only have 4, lol, so I also used a bunch of Vanguard funds and as I was looking at them, I started to notice that they were freakin’ nice.

I’ve got my investments with Vanguard. I know that people have nice things to say about Fidelity as well, but I tried to help hubs make some choices about investments on Fidelity, and I could not figure out how to even learn about the options! Vanguard’s website is pretty easy to use, which is an added bonus, I think!

I’m a boglehead and big fan of Vanguard. Still have a small portion of my portfolio in a different company. Been thinking about moving that over too. Is it bad to have EVERYTHING in one institution? Anyway, I don’t think you’ll find many haters out there but there are plenty of haters of low fee index investing which Vanguard promotes…though they also have actively managed funds (which have pretty low fees too).

I’m pretty sure the funds are all safe whether it’s with one company vs 100 as the institution is mainly a “tool” and the $$ is federally protected, but I could also be wrong in that :) I think you just gotta go with what makes you comfortable and if that means having multiple accounts then that’s how it goes…

I switched over about a month ago from T Rowe Price. I initially chose T Rowe because I didn’t have a large portion to transfer over.

Only thing I would check and I’m not sure if it’s avoidable, but I was charged a $20 admin fee from T Rowe Price to close out/transfer the accounts, so you might want to check the USAA docs or website to see if it’s similar. Boglehead, ha.

I’m 99% sure I don’t have to pay any fees as the Vanguard rep looked it up before we made the xfers, but either way I’d still do it anyways just cuz of the long term savings/earnings. Though having multiple accounts being moved and fee’d would sting for a hot second :)

Thank you so much for this post! I just started a job where there is no 401K, so I am on my own and dying over who to pick. The love for Vanguard here is obvious, and helps me out with that process. :)

Very nice J! The only issue with Vanguard, and it’s admittedly a pretty small one is the entrance for some of their funds are at $2500 or $3000. But, then again, that isn’t too bad at all and shouldn’t keep more serious investors away from them. Other than that, it’s definitely hard to beat Vanguard. I love that their private, i.e. not driven by wanting to please shareholders so they can bump up their share price by a few measly cents and they make it very easy – which is the way it should be. I love me USAA as well and we have everything with them…just not our investments. :)

I am a Vanguard hater, especially for people who are not familiar with investing. I have used multiple websites and I have a handful of clients who use Vanguard and whenever we try to search or research the functionality is REALLY poor and they always say “I guess you get what you pay for.” Which is true. No bells and whistles is fine if you know exactly what ETFs or funds you want to put your money (especially if they are Vanguard funds, God forbid you want another fund) then it is fine. I just think they are not useful to those who are “new” to investing.

While I don’t personally use Vanguard, I have heard nothing but good things about them. Since I’m guessing you’re going to be investing in index funds, Vanguard is definitely the company to go with, you can’t beat their low expense ratios. Since I primarily invest in individual stocks, I’ll probably be staying with USAA for the time being.

We’ve got about 50% of our investments at Vanguard, and well over 50% of our recurring investments head there too. If all our other investments weren’t in similar low cost accounts we’d transfer those too. All we’d have to gain now is the laziness factor, which can’t be discounted :) Also looking forward to hitting all Vanguard’s Voyager and Flagship personal service milestones. Next up 500k, then before you know it 1mil and 10mil :P Although based on JL’s comment I wonder how helpful their advisers really are.

I’m somewhat of a boglehead – even if I don’t have a Vanguard account, I still follow Jack Bogle and his philosophy. I’ve just kept everything with Fidelity (in their Spartan funds mostly) because I do like to play around a bit with stocks directly – that and the hassle of moving everything over. Good to hear that the transfer process went smoothly.

Vanguard ROCKS! I’ve been a loyal fan/investor for 25 years. That’s right. And they never disappoint. In fact, I recently wrote a post asking Vanguard to be my valentine…that should tell you just how much I adore that company! Here’s the link for anyone interested: http://www.escapingdodge.com/my-valentine/

As far as their “low cost fees” go, be sure to consider their Admiral funds. These are mirror images of their regular funds but requires a minimum $10k to invest (and limits moving funds to every 60 days) BUT the benefit to using these funds is EVEN LOWER FEES!!!!

Other than my 401k & HSA (which I have no choice in), all our investments are with Vanguard, in index funds. The only thing I wish I’d thought more about was tax efficiency when setting my accounts up. Initially we set each account (e.g. – Roth IRA) with our asset allocation (so, 25% of our Roth was bonds, 25% was international, etc.). Later, we found could be more efficient tax-wise by putting all our bonds in tax-advantaged accounts, and to put the most tax efficient investments in our taxable accounts. Anyway, I wanted to share that as you’re just now making the switch…it might save you some money on capital gains if you’re selling/transferring/rebalancing.

Thanks for the heads up :) I’m not much of a bonds person to be honest with you so I doubt it’ll be a part of my new plan, but then again now that I have kids and trying to be more “adult” like (ie not have 100% of money into risk), that can change in the near future… Still learning as we go here :)

Guess I’m a boglehead since I’ve been there since 1995. No regrets in rolling my accounts under one roof. Like many others here, I’ve never had a problem!

I think you should consider a few other accounts to your mix.
– A “Cash” account. The key point here is that there are no restrictions in/out. Vanguard likes to spank people when they “time” the market. To avoid the perception, you sell from one account with the cash deposited into your cash account while simultaneously placing a buy from the cash account. Is this market timing or are you just on your toes to ride the wave?
– An Individual/Solo 401(k). OMG. Vanguard began offering this in 2008 and I was all over this. Self direction at it’s best with just about all of their funds available to you.
– A Roth Brokerage Account. Want to buy individual stocks? Depending on your portfolio value, you could have unlimited $2 trades..

Yup! I got a Roth Brokerage Account, as well as a SEP Brokerage one too for those exact reasons :) I still need to look into the solo 401k route (as many people have prodded me too over the years), just haven’t stopped to do so yet. I’m pretty happy with the SEP to be honest but I’m sure at some point it will make sure to switch – at least from what I’ve been told.

Luckily I did research before opening accounts and avoided a lot of fees. I think I’ve spoken with someone at Vanguard once, and that wasn’t when I opened any of our three accounts. Since we’re still in early accumulation, we’re just going with a LifeStrategy fund. Once we’re investing in a taxable account several years down the road, I’ll make the effort to split it up and optimize our tax efficiency. Right now everything is tax advantaged so it’s REALLY easy.

I’ve been a long-time fan of Vanguard, somewhat by accident. My most recent employer used Vanguard for their 401(k) offerings, and I’ve been hooked since. I’ve got my parents signed-up and continue to “spread the gospel”. #lowfees

Vanguard has been great for me and it still sometimes amazes me how low their fees are compared to other companies. I will be with them for a long time and I’m sure there are many others who will also.

I stumbled my way into a Vanguard account in 2004 because someone told me to. In 2009 I started looking into early retirement and found the bogleheads. Since I was lucky to already be set up with vanguard I just posted my info and got some free (but good!) advice…from then on…I was hooked! Boglehead here!

You should read “The boglehead guide to investing” or “guide to retirement”. The books are such an easy read and really explain things in a simple way so anyone can be confident in planning their own investments.

I think it’s worth noting that to transfer accounts from USAA to Vanguard, you have to print and fill out a form for every single account and mail it in. Then, it says it can take 3-4 weeks for the money transfer to take place. As someone currently going through this with my 6 accounts – I think it might be a bit more cumbersome than this post implies. Well worth it!… but cumbersome…

I just re-read the post and realized that you had said it didn’t require any paperwork for you… perhaps they have changed their process? But they are making me fill out paperwork and send it in for each account (all within USAA too). After calling, they said there was nothing they could do and USAA requires it this way.

I’m trying to remember how I did it, and I think I went through *Vanguard* and had them initiate the xfer if I’m not mistaken. I remember them saying that they weren’t sure how smooth it would be or not, but then after they started the process it all just started moving over!

So maybe that’s the route to look into for others thinking about doing this… I did have to sign some stuff, but I did it all over the computer while the Vanguard rep was on the phone walking me through it. I literally didn’t do a thing with hard copies or waiting or any of that. It took some time for all the funds/$$ to be moved over, but outside of that it was all rather smooth…

Sorry you had such a hassle :( But yay for moving over! Will def. be one of those one-time annoyances for lots of future benefits :) Congrats!

I’ve been trying to setup my vanguard account for over a month. Not please at all thus far with the customer service or the “ease of setup.” I should note I’m not doing this incorrectly, I’ve done these before and do tech support for a living. Filling out a form isn’t rocket science. But each time I have it says it can’t verify my identity – despite them having my SSN. So guess who gets to print off a 18 page document and mail It in old school?! A joke thus far, it better be worth it once I’m done.

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